Turning The Page

This year's National Automatic Merchandising Association National Convention and Expo brought the century to an end on a high note. The 54th staging of the world's premiere trade show for vending and coffee service showcased an industry that would have been difficult to imagine in 1947.

Observed in perspective, trade shows represent annual summaries of the solutions devised to meet perceived industry challenges. For that reason, productivity enhancements were much in evidence this year.

Visitors saw a number of approaches to interrogating vending machines remotely, to determine their inventories, column-level sales performance, collections and functional status. Operations and service managers armed with this information will be able to deploy route sales and technical personnel much more efficiently. Machine load plans can be fine-tuned to maximize sales at each stop, and it will be possible to service more machines in the same period of time. The first telemetry system we ever saw was exhibited at a NAMA trade show almost 30 years ago, and the 2000 National Expo summarized the tremendous improvements in technology over the ensuing decades.

The show also provided a snapshot of the ongoing enhancement of vending's merchandising capability. The glass front beverage vender seems to have come of age, while equipment delivering premium coffee to the customer's taste continues to be introduced for locations of all sizes. New small-site vending initiatives made their debut, and more host-and-satellite systems were exhibited.

Taken together, these developments hold out some intriguing prospects for the first decade of the new millennium. A hot topic among showgoers was the increasing likelihood that consumers will be able to make vending purchases by electronic funds transfer. Several ways to do this have been demonstrated, ranging from installation of an Internet terminal in the vending machine to methods for using a cellular telephone or wireless "personal digital assistant" to transfer the purchase-price from the user's account to the operator's, upon which a central computer would enable the vend, perhaps using the Internet as the networking medium. The new Internet cards, which work rather like a prepaid phone card but which allow consumers to associate a designated amount of credit with a personal identification number, also may have vending applications.

What is noteworthy about these concepts is that the truly interactive vending machine would solve a number of related problems for operators. The immediate benefit of remote inventory and collection monitoring is that it can eliminate "overservicing," allowing calls to be scheduled "just in time." The obvious benefit of remote cashless purchase authorization is that it can increase sales by decoupling vend purchases from cash on hand.

But the potential benefits extend far beyond these. For example, an affordable technology for remote monitoring and purchase verification can greatly expand the scope of products offered in workplaces staffed by relatively few people, but well-compensated ones, working long hours - the characteristic sites of the "new economy." These products certainly will include high-profit ones like gourmet coffees and other refreshments that can be marked up sufficiently to achieve the necessary return on investment to justify providing the service. The ability to provide that service only when the equipment requires it, and to avoid lost sales by enabling consumers to make cashless purchases, will transform the economics of lower-traffic locations.

And this, in turn, can transform the economics of high-volume sites as well. The modern vending industry rose to prominence by capitalizing on its ability to provide fast, convenient service in industrial workplaces during the last great era of the "smokestack" economy. Although it quickly was extended to other types of location, many operators continue to believe that the public associates vending with the price-sensitive basement cafeterias characteristic of old-line factories.

We are not convinced that today's public makes this association; and we are certain that today's vending equipment can be marketed as a supremely convenient, value-added source of quality products. Tomorrow's technology can only reinforce that perception, to our great benefit.